NEW YORK (TheStreet) -- News Corp (NWSA) - Get Report stock is declining 1.52% to $14.21 in midday trading on Friday after the media company announced that its Australian division secured a five-year deal with the National Rugby League.
News Corp Australia and its subsidiary Fox Sports Australia secured a five-year deal with the league, which will allow Fox Sports Australia to show every game live and ad-free in 2016, the company said.
The deal, which incorporates media company Nine Entertainment and Australian telecommunications company Telstra, is worth about $1.8 billion, the company said in an SEC filing on Friday.
Additionally, in 2017 Fox Sports Australia will launch a new National Rugby League channel.
"This is a truly outstanding deal that will, for the first time in the history of the game, give fans live coverage of every game each round. It's a big win for the fans, and a big win for the clubs, and News is delighted to be a part of it," News Corp Australia CEO Peter Tonagh said in a statement.
Separately, TheStreet Ratings team rates NEWS CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
We rate NEWS CORP (NWSA) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and a generally disappointing performance in the stock itself.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Media industry. The net income increased by 169.2% when compared to the same quarter one year prior, rising from $65.00 million to $175.00 million.
- NWSA has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, NWSA has a quick ratio of 1.50, which demonstrates the ability of the company to cover short-term liquidity needs.
- NEWS CORP has improved earnings per share by 46.7% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, NEWS CORP swung to a loss, reporting -$0.22 versus $0.41 in the prior year. This year, the market expects an improvement in earnings ($0.55 versus -$0.22).
- Net operating cash flow has decreased to $106.00 million or 42.07% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Media industry and the overall market on the basis of return on equity, NEWS CORP underperformed against that of the industry average and is significantly less than that of the S&P 500.
- You can view the full analysis from the report here: NWSA
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.